Branch advisers at Britain’s biggest building society Nationwide claim they are under pressure to hit intense sales targets.

One whistleblower who contacted This is Money claims that after 18 years of experience working for Nationwide, he feels he needs to get out of the industry altogether due to the immense pressure and has written an in-depth letter to the Financial Services Authority (FSA) outlining his concerns.

At the same time, a now former recent member of staff said he was regularly threatened with performance improvement plans – which he claims was a way of saying boost your sales or you’ll be sacked.

This is Money takes a look into the claims in the fourth part of its investigation into sales practices within branches throughout banks and building societies across Britain, and gets Nationwide’s side of the story.

Under pressure: The whistleblower, who works for Nationwide owned Derbyshire BS, says he is under pressure to hit sales targets

A whistleblower – currently employed as an adviser in a Derbyshire BS branch, an offshoot of Nationwide – says that he is ‘under immense pressure to sell the society’s most profitable products.’

As a result, he says he has been threatened with a ‘hearing’ to assess whether he should receive a written warning for not achieving target.

He says that after 18 years’ experience, he now feels that he has to get out of the industry altogether, as he lifts the lid on the target culture he has witnessed in the branch he works in.

He says: ‘The culture adopted in retail financial service is totally geared up to mis-selling.’

He has written a letter to the FSA to outline his experiences to help try and ‘end the misery for employees, and also to stop vulnerable consumers being forced and bullied into taking out products that may or may not be beneficial or suitable.’

Traffic light targets overrides customer service

Traffic light system: Whistleblower says league table is published - and those in the red are 'shamed' as the worst offenders

The whistleblower says that while customer service has become more closely monitored and encouraged in recent times, he feels that the sales of ‘profitable products’ is by far the overriding priority and the pressure applied to frontline branch staff is highly ‘inappropriate.

In his letter to the FSA, he says: ‘Personally I have witnessed mis-selling of products including long term savings accounts, life cover and home insurance policies. I need to highlight to the FSA what I feel are the main causes for this culture.’

He says a large part of this 'mis-selling' comes from the pressure of league tables that are published on the intranet each week. This shows branch staff and their current performance to target with a red, amber and green system.

This, he says, is purely based on the number of ‘points’ gained from sales of the most profitable products.

Staff members in the red and towards the bottom of the table are effectively named and shamed, challenged by management and ultimately threatened, he claims.

He also says that no points are awarded for good customer service, or the products that generally attract customers to the society – such as fixed-rate bonds, Isas and high interest savings accounts.

He says he has a quarterly target, broken down into monthly targets. He gets 260 points, for example, for a home insurance policy for building and contents, with a bonus 75 points for home emergency cover.

Products that he is expected to sell tend to be ones that have received ‘fairly negative press coverage and can be difficult to gain customer interest,' he claims.

An example of this, he says, is a protected equity bond - selling one of these complicated structured product investments generates 200 points per account. He says that more often than not, the customer would be better off with a long-term savings product – but no points are accrued for advising this.

Another whistleblower who worked at a Nationwide BS branch recently, also commented: ‘Savings accounts were irrelevant, in my role I wouldn’t get anything for opening up a savings account with £10,000 but you would if you sold a home insurance policy.’

The Derbyshire BS whistleblower added: ‘Customer appointments are set up from the beginning with the sole intention to gain ‘points’ for the cashiers, advisers, branch and area managers.’

Little details are ammunition to sell products

According to the whistleblower, cashiers organise appointments for advisers and put notes in the diary such as ’70 year-old push for AXA’. This is because cashiers also have targets which relate to sales leads.

This AXA product is a five per cent growth account and according to the whistleblower, they are pushed to bill this as the best way for elderly people to save for grandchildren. This particular product also has the option to increase the death benefit by five per cent each year, but the monthly premiums also increase at the same rate.

He says he is expected to leave halfway through interviews with customers – called a ‘people break’ - to speak to the manager about potential sales opportunities for that customer and to reveal ‘soft facts’ they have obtained to help link with product sales.

For example, if he finds out the customer has grandchildren, an adviser could push them the AXA life cover policy to leave as a gift – he claims he is then instructed to push for a quote. This would garner him 125 points – and also add to the branch’s quarterly target.

He says that if he doesn’t identify a sales opportunity during this 'people break' then he is expected to explain to his branch manager why he hasn’t.

Performance plans: The whistleblowers claim that they are being 'forced' onto PIPs - and are 'threatened' with the sack if they don't sell enough

‘Feel like we’re being forced out of Nationwide’

The Performance Improvement Plan (PIP) which the whistleblower has been threatened with has been a common theme within the contact This is Money has had with Nationwide BS branch staff.

He says that in August, a colleague of his left after one of these hearings, as he was worried about it being left on his record.

A separate whistleblower, who worked for Nationwide BS for three years, said he had to quit because he became depressed.

He said it was down to a combination of ‘the stress of the PIP and threat of being sacked,' his manager breathing down his neck after every customer interaction and the moral issues involved in mis-selling.

He adds: ‘I know of two people that were said to be role models because of their sales figures but they were both suspended after someone investigated them.'

Not surprised the industry is receiving such bad public opinion

The whistleblower concluded in his letter to the FSA: ‘I have worked in retail financial services for over 18 years, and I'm disappointed (but not surprised) that the industry is now receiving such bad public opinion.

‘In my role I continue to ignore instructions to force customers into home insurance quotes and pressurise vulnerable pensioners to take out life cover.

‘I have no doubt that the banks and building societies will eventually be forced into changing policy and remove sales targets for branch staff, but in the meantime I would appreciate some advice and guidance so I know where I stand.

‘I have raised concerns through my line managers but have been told to just live with it and embrace the “Nationwide way”'.

Customer service: A Nationwide BS spokesman said that customer service is the focus - not sales targets

NATIONWIDE: WE ARE ON YOUR SIDE

Nationwide BS prides itself on being a building society – not a bank. A current advertising campaign says: ‘You do need a bank account, but you don’t need a bank.’

But with these whistleblower claims, it appears to have the same kind of sales targets as banks that This is Money has investigated, including Lloyds TSB and Santander - and the question is, are its 2,000 advisers under hard pressure to sell?

This is Money took the whistleblower claims to Nationwide BS.

It said that these whistleblowers are an anomaly, as the majority of their staff are happy and while they do have targets, these are mainly customer service orientated and not designed to pressure staff into selling certain products.

Graeme Hughes, Nationwide group director for people, customer and communications, and who was previously divisional director of the branch network, said: ‘Our overall approach means that we try very hard to be very supportive to our staff. We will train staff, have meetings once a month and have high levels of engagement with them.

‘We rank highly against other financial institutions when it comes to staff satisfaction – higher than the banks and 40 per cent higher than the industry normal. We also have a monthly survey of all our branches.

‘Our ethos is to be professional, to be on the customer’s side and to give the highest level of customer service on the High Street - and we test that this is happening.

‘We do, for instance, pull our staff during an interview with a customer, while the customer is filling in a form. Staff will chat about the customer to their manager and discuss the customer’s needs and make sure they are speaking to the right staff member.

‘In terms of PIPs, our turnover of staff is low and this particular employee appears to be hacked off. We have 17,500 staff, and absence levels are low. PIPs are across the business as a whole and we identify that performance needs to improve. This is common for new members of staff who those who have had part of their role changed and they are also supported by a staff union.

‘This is to improve behaviour through our structured support plan, which ranges from one week to six months, with regular support until the end of that process. In response to your question about how many staff are on these plans, it is in the low couple of hundreds figure.

‘Last year, we had a very low staff turnover – handfuls left. If a staff member has a hearing, a staff union representative will be present. I don’t think the claim from the whistleblower is credible to how we approach things. If there was a pressure culture, absence would be high – and it isn’t.

‘We do have targets in our customer base and have target markets, with annual targets for our sales force. There is a league table on a quarterly basis, but this is to celebrate top performers – people that have performed good customer service, had low complaints and complete paperwork well.

‘We also have targets to keep the branch manager informed, to help the service we deliver and for risk issues.'

Does Nationwide owning smaller societies hurt competition?

As well as branch advisers contacting This is Money, customers have also sent in their views of the building society.

One query was: ‘Nationwide BS own Derbyshire and Cheshire Building Societies and use the same banking licence, yet these brands have consistently offered better savings rates. The big question is why? Is it to give us the illusion of choice or competition?’

I asked Nationwide for its opinion, and it said: ‘Savings are part of our core stable and many people come into branch because of the attractive savings products – however, we find it hard to track savings sales to branch staff, due to the vast numbers of products we have and that are taken out.

‘We do own the regional brands – and these too offer attractive rates, but are separate brands. In the longer term we plan to bring everything under one roof.’

Nationwide BS also added that the whistleblowers who have contacted This is Money are a handful of disgruntled employees who do not reflect the large number of staff - it advised that the branch staff in question should raise any issues with the staff union, as should any other unhappy staff.

'Customer service at the heart of mutuals'

The
UK has 47 different building societies according to the Building
Society Association (BSA). Mutual lenders and deposit takers have total
assets of over £375billion.

They
hold over £250billion of retail deposits, accounting for 22 per cent of
all such deposits in the UK. Mutual deposit takers account for about 31
per cent of cash Isa balances.

They employ approximately 50,000 full and part-time staff and operate through approximately 2,000 branches.

A
spokesman for the Building Society Association (BSA) said: ‘Staff working at building societies make it a top
priority to ensure consumers get the products they want and need.

‘Customer
service is at the heart of what makes mutuals different to plc banks
and is one of the many reasons why the sector has continued to grow in
strength over the past year or so.

‘Although
the precise measurement of staff performance is society specific,
customer service and satisfaction are important factors, irrespective of
size.

‘The mutual
machine is driven by loyalty, community spirit and friendly service,
evidence of which can be seen in research undertaken by independent
organisations such as Which? who revealed in September this year that of
the top ten financial institutions ranked by customers, six were
mutual.

‘BSA research
showed a similar customer response, with mutuals outscoring plc banks
across 11 aspects of customer service. Mutuals also accounted for just
3.5 per cent of all complaints made to the Financial Ombudsman Service
in the 2011/12 financial year.’

STAMP SNEAKY SELLING TACTICS OUT:If
you have received a hard-sell sales pitch or work in a bank or building
society and have seen mis-selling first-hand, please contact me in
confidence: lee.boyce@thisismoney.co.uk.